Cryptocurrency has a few pitfalls to worry about
Dec 19, 2017, 8:19 AM | Updated: 9:30 am
Bitcoin is a cryptocurrency that has gained popularity in recent years. (AP Photo/Kin Cheung, File)
(AP Photo/Kin Cheung, File)
Another cryptocurrency is going crazy. This one is called Litecoin, which is up about 8,200 percent so far this year. Not even Bitcoin can match that!
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And you’re tempted to buy some, aren’t you?
Well, before you can buy a cryptocurrency you need a cryptocurrency wallet to hold your private key, as explained on the Coinbase website.
“A private key is just a very long string of numbers and letters that acts as the password to your Bitcoin wallet.”
You can’t memorize it so you typically store it in a hardware wallet that plugs into your computer. You type in a PIN to wake up the wallet, which then sends the secret code to unlock your money.
But if you lose or forget your PIN, you can’t just go to a bank and prove who you are. Your money’s just gone.
That happened to Mark Frauenfelder, an editor at WIRED magazine, who lost his wallet code. He had $30,000 in Bitcoin in that wallet. To retrieve it he had to hire a hacker who showed him how to physically pry open his hardware wallet and then load in a special program.
He had one chance to get it right, otherwise, $30,000 would just disappear. He was successful.
Of course, losing your PIN isn’t the only pitfall, as one helpful tutorial explains.
“In the event of internal fraud or external hacking, your Bitcoins will likely be irretrievably lost.”
Welcome to the future. Ain’t it great?
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